From "Avatar" to "Wallet": the definitive metaverse glossary for dummies
18 experts shared their view
If companies want to get into the metaverse business, they first must master the "metaverse lingo." It's easy to get lost in translation, with dozens of brand-new mysterious acronyms (NFT, DAO, DeFi...) and business neologisms (mining, minting, dropping, burning...). What is/are, in your opinion, the main term/s entrepreneurs need to understand to separate the hype from the business reality of the metaverse?
From "Avatar" to "Wallet": the definitive metaverse glossary for dummies
If you look at technology from a decades or even centuries-long perspective, you realize that there will always be new terminology. This makes sense; we need neologisms as communication shorthands (and to a lesser extent, these terms help experts substantiate their own credibility!). The one thing that hasn't changed throughout is human emotion. In this case, top of mind becomes tip of the tongue, or buying from what emotionally resonates. Hence, with any lingo, the question is always: cui bono? Who benefits? Where I see the benefit right now is in previsualization or using metaverse technologies to let hotel guests try before they buy. While immersive, synchronous virtual realities will take awhile to reach mass adoption, by offering customers a convenient, 2D interface to see a property, its rooms and its amenities right now, hotels can increase the emotional attachment to the brand, thus raising buyer confidence to lead to more revenues.
The Metaverse doesn't start and end with web3. There are Metaverses such as VRChat, AltSpace, Mozilla Hubs that run on VR, are centered around events and community, have a big recurring user base.
The ideal way to create a Metaverse is with an economy powered by crypt, so users can experience true digital ownership of any items they use there (clothes, furniture, art, etc.), because each item would be an NFT, no matter what happens with the platform, our stuff stays our stuff.
This is different from other Metaverses such as Roblox, a company that is valuated at almost 89 billion dollars. Their recurring user numbers are through the roof, and all that with the next generation of consumers. A gucci bag sold for 4K USD on there, it is very much a metaverse with a currency and an economy. But it doesn't run on crypto, the items are not NFTs, if Roblox goes under it will take with it everything you own there, even that Gucci bag.
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Interoperability: Interoperability refers to the ability of different virtual environments, platforms, and technologies to work together seamlessly. This means that users should be able to move freely between different virtual worlds and experiences with his assets.
NFTs: Non-fungible tokens (NFTs) are digital assets that are unique and cannot be replicated or replaced. NFTs provide a way to represent and transfer ownership of virtual assets, such as virtual real estate, digital clothes(skins), digital game tools, digital art, and other virtual items.NFTs help to facilitate interoperability by providing a common framework for representing and transferring ownership of these assets across different virtual worlds and platforms.
While, the initial focus of an interoperable metaverse will be on providing a seamless experience for consumers, it will be important to retain the value of their virtual assets, such as virtual clothing and accessories, even if they switch to a different virtual platform. It will be important for generating sales and establishing a metaverse economy, allowing consumers to easily buy, sell, and trade virtual assets across different platforms. In an ideal scenario, virtual assets like the D&G jacket your avatar buys on one 'metaverse' would be accessible and usable on another 'metaverse'.
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Immersiveness is the degree to which a virtual environment submerges the perceptual system of the user. Immersiveness could be described also as the state of being surrounded by audio-visual stimuli in a passive way. User Experiences in the metaverse will be immersive but not passively immersive. Users will be able to interact with the environment and the avatars with some degrees of freedom.
Persistence is the prolonged existence of something. The metaverse will be persistent in the sense that it never “resets” or “pauses”. It will retain memory of what we did in the past. If we break a road sign in the metaverse that damage will be visible to all the other users. Persistence is essential to build a virtual society.
I would agree that WEB3 has proven to be not only a business or technological phenomenon but also - quite vividly - a social one. I think it is extremely important that business people realize the wholeness of this movement and attempt to comprehend the social aspect along with the other ones. This can be particularly difficult for mature businesses, and not so much for native WEB3 startups (that have problems of their own youth).In my previous comment on open metaverse, I remarked that many people were driven into the web3 by greed. The incumbent businesses also make the mistake of thinking the money in WEB3 is laying on the streets. And so we have a 50% processing fee that Meta (formerly FB) wanted to impose on NFT creators and provoked stern criticism from the WEB3 communities. It should begin to reveal that we are talking about intelligent, economically-aware people (or at least above average). To be able to create a suitable offer, be it a product or service, and use the competitive advantage that mature businesses possess they need to learn more about the WEB3 sociological aspect, and that surely begins with the language. And then, who knows perhaps WAGMI...
The Metaverse is a collective virtual shared space created by the collision of the physical and digital worlds. It is a virtual world in which people can interact with each other as well as with virtual objects and experiences in real time. Some key terms associated with the Metaverse include virtual reality (VR), augmented reality (AR), and mixed reality (MR). These terms refer to various methods of combining the physical and digital worlds, with VR being fully immersive and digital, AR overlaying digital information on the physical world, and MR blending the physical and digital in a way that is difficult to distinguish from reality. Avatars, which are virtual representations of users, and digital assets, which can become virtual goods that can be owned and exchanged, are two more crucial elements to comprehend in the context of the Metaverse.
With the Metaverse growing into what will someday be a main source of income for most companies and organizations worldwide, I believe it is crucial to understand that every Web3 project should be tackled as a business of its own; solving a problem, having a business model and executing a business plan (roadmap). With that being said, I think the most crucial terms for early entrepreneurs in this industry are:
DAO: We'll be seeing a lot of this term as the metaverse grows. I can argue that companies that want to be Decentralized should go down this road at some point.
De-Fi: Beyond Trading Platforms and Cryptocurrencies, De-Fi is a way out from the traditional centralized banking systems.
Smart Wallet: Your Digital wallet where you can put all your Digital Valuables.
Smart Contract: A Blockchain based algorithm automating your project when predetermined factors are met.
Blockchain: While some argue it is important to fully understand it, I think it"s enough to know the basics as to how it functions.
NFTs: Your Digital Assets.
Minting: Publishing a Digital Asset onto the blockchain.
Burning: The act of destroying a Digital Asset.
These are the Basics In my Opinion.
I think the main confusion which needs to be clarified is the difference between Web3/Crypto and Metaverse. A possible explanation:
- Crypto: a new feature of the internet which learned to transfer value natively. Before, it could only transfer information natively.
- Web3: as time went by we realized crypto was unlocking much more than value transfer, and would transform the web at its core, hence a major upgrade which deserves a new version (3).
- Metaverse: a persistent "place" which can be experienced in many ways, of which AR/VR are the most advanced to date. In many ways, the Metaverse is the internet itself.
Here's the key: the "place" can run on proprietary systems (corporations owning the database) or on shared protocols (users owning it) making the metaverse a public shared space where users own their assets).
It will probably run on both, a bit like in the real world, there are countries based on rule of law and others based on authoritarian rule.
So, Web3 makes the metaverse the internet.
Web2 makes it an intranet, a wallet garden.
DAOs/NFTs/DeFi and so on, can be explained only after this is clear.
When dealing with the Metaverse glossary, we will need to understand the terms beyond the literal dictionary definition of the term, so we can understand the impact of the term on our business model and our clients. Sometimes we need to be reductive when explaining a term or a concept to someone who is hearing it for the first time, like saying that the Metaverse is an evolution of the internet from a 2D experience to a 3D experience or that interoperability is comparable to integration. Yet, once you dig deeper you will immediately notice that there is much more to it.
Three key terms act as the spinal cord of the Metaverse and need to be well understood in the context of their impact and utility. Digital twins, Phygital, and what could be referred to as Metavtwins.
Digital twins are a digital representation of a physical product, process, or system. Phygital is used to describe bringing the best parts of the physical customer experience into the digital realm and vice versa. Metavtwin is used to describe going from digital to physical, bringing the creativity of the Metaverse to the physical products, processes, and systems.
Any business entering the metaverse should think of the reasons and benefits first. I believe most companies are entering the space today only because of the hype and they do not always have solid reasoning behind that. Furthermore, we have over 180 metaverses today, so it is very difficult to choose the one to go into.
When it comes to the lingo, it is more beneficial to understand the business implications behind the term rather than simply what the word means --> knowing NFT stands for "non-fungible token" is great, but to unlock the potential one should know how this can benefit the brand/company and its customers.
In my personal point of view, I am trying to understand DAO (Decentralized Autonomous Organization) as an open, transparent, yet secure capital/asset management system as the ultimate goal of having the benefit of capitalism but the fairness of socialism. Where the invisible hand of capitalism becoming visible, and fairness is maintained with the consensus of every member of the community. It may not happened in the near or short future due to many reasons, especially the current power holders is still rely much on capitalism. But along with the development of blockchain and its easier adoption, I personally believe we will welcome an era where everyone can be beneficial from their real values, merits, and integrity. Rather than just financial privileges.
Dear reader! Let's embark on a brief journey:
- Do you remember the first time you tried a PC? I am not that old, and I used to store data in a 5 ½' floppy disk (google it!), unimaginable today!
- How about using the fax? (apologies GenZ, there are whole generations who not so long ago used this prehistoric tool derived from the word "facsimile")
The metaverse is a nascent space in an exponential age where everything evolves extremely fast and adoption cycles are shortened, and yet we are so early that we haven't reached the level of user experience that other technologies have achieved. Right from the beginning, the way to access the metaverse presents challenges: Web3D, PC, VR, AR, it's so hard to resonate with it for most generations!
No glossary of terms will do the job of separating the hype from the business reality of the metaverse.
The metaverse is a virtual world built (or having to be built) on top of a public blockchain.
To do business in the metaverse, it is important to understand the key terms and concepts that are central to this space.
These include cryptoassets, which are digital representations of value that are unique thanks to the use of cryptographic mechanisms; tokens, which are digital bindings that link physical or digital assets to native assets on the blockchain; smart contracts, which are programs that automatically execute contracts and can be used to manage commercial relationships in the metaverse; NFTs, which are tokens used to represent unique, intangible assets and their associated rights; and DAOs, which are decentralized organizations governed by encoded rules rather than a central authority.
Understanding these concepts is essential for entrepreneurs looking to enter the metaverse business as they will have a chance to survive resiliently.
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From my perspective, companies don't need to be fluent in Metaverse lingo but to understand the utility that they can bring from the Metaverse, the "use case" that better works for each business.
Regarding "lingo" I have realized that every time I talk about the Metaverse with somebody that is not familiar with this world, some important concepts and vocabulary must be explain. Here I listed some words, useful not only for business but for whoever wants to experiment the Metaverse: Metaverse, Web3, Utility (in Web3), Utility (in the Metaverse), Blockchain, Blockchain Transaction, NFT (Non-fungible-token), DAO (Decentralized Autonomous Organizations).
Last but not least, it is important to say that when we talk about 'metaverse' or 'blockchain' we are not talking about something for investors only but about something that has an utility IRL (In Real Life).
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For now, focusing on the terms that are being used in utility cases is essential to separate the business reality of the metaverse from the hype. Also is crucial to understand that as the metaverse progresses, many terms have become ambiguous. One of the obvious examples, in 2021, NFT meant collectible JPG minted in the blockchain network, but now it could mean Ticket, Credential, Virtual Land, Membership, etc. Thus, using specific terms and avoiding general/ambiguous terms is essential.
Prior to exploring my must-know terms about the Metaverse, it is worth considering that it is in an industry evolving so rapidly that what is written here will certainly not be relevant in a few years. This means that a flexible and adaptive mindset is essential in understanding this topic.
Avatar: It is the digital representation of our identity, allowing businesses to have a presence that carries their values in the Metaverse, and should therefore be consistent with the expectations of their audience. When considering the end user, there exists a solid opportunity for businesses to create and distribute products that represent them.
Platform: It is an ecosystem of interconnected applications, generally provided by a company. Not all platforms are interoperable, due to technical challenges and lack of standardization; however, once the Metaverse is fully realised, we can expect to be able to bring your avatar and assets from one platform to another.
World: This is the actual virtual space within a platform, generally built by creators. It is crucial for businesses to understand that the creation process is very immersive and collaborative, meaning that the professional role of a creator is essential for a world to be successful.
Words are just words, people/entrepreneurs should understand why Metaverse and Web3 can actually change how we intend our digital activities.
For instance, why are we still talking about NFT? Why aren't we talking about digital ownership and how to exploit this new opportunity?
I strongly believe that companies and entrepreneurs need to deeply understand all the new acronyms and then translate these in words that everyone already knows and understands. In this way entrepreneurs can easily:
- Understand all the new opportunities brought by Web3;
- Build a product/solution based on these new technologies;
- Make this new product/solution available for everyone, communicating through already well-known terms.
Hard to pick. "'Metaverse" itself is really just an umbrella term, referring to a convergence of various technologies and concepts. Except for the obvious choices (VR, AR, avatar, land, etc.), I'd go with the following three: datafication, decentralization, and FUD.
Datafication refers to the collection of data on an individual's surroundings and behaviors while in virtual reality, with headsets able to track and gather information on hand movements, objects in the (physical) environment, and more. Twenty minutes in VR collect two million pieces of data!
Decentralization refers to distributing power and property on the web, allowing for a more democratic and disintermediated decision-making process when compared to Web2.
FUD is an acronym that stands for "fear, uncertainty, and doubt." It is a tactic used in PR, business, and propaganda to manipulate public perception about a particular product, technology, or individual by spreading misinformation that generates negative emotions and creates uncertainty or doubt about a subject. In the metaverse space, FUD is often used to describe general skepticism or negative attitudes toward virtual, augmented, and extended worlds, but it can also be employed by supporters of a specific company to deflect criticism.
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